Enhances and integrates with existing insurance policies to fill any gaps in coverage

Can supplement a Group Captive

Facilitates recapture of premiums not used to pay claims

WHAT IS A MICRO CAPTIVE INSURANCE COMPANY AND HOW DOES IT WORK?
A Micro Captive is a captive insurance company operating with an annual gross premium up to $2.2 million. In the United States, qualified under Internal Revenue Code 831(b), a Micro Captive will pay tax only on investment income and not on underwriting profit. The underwriting profit can either be returned as a dividend or subject to limitations prescribed by the IRS, remain in the captive as surplus. The Micro Captive must qualify as a bona fide insurance company and serve a business purpose.

IRC SECTION 831(b) PROVIDES THAT:

Insurance companies with less than $2.2 million of annual premium (as adjusted for inflation) pay $0 income tax on insurance profits.

Investment income is taxed as income to C-corporation

831(b) must be timely elected and cannot be revoked without the submission to and approval by the Secretary of the Treasury

TAXATION (Consult with your Tax Advisor):

Premiums are deductible when paid under IRC Sections §162 and §212

Income tax on investment income only

Minimum premium taxes

Dividends are taxed as qualified dividends

Termination surplus are taxed as capital gains

IS AN 831(b) MICRO CAPTIVE SUITABLE FOR YOU?
To help determine if a Micro Captive is right for you, Cherry Bekaert Benefits Consulting will perform a full review and actuarial analysis of your current program (including incurred and realized claims). Our certified insurance counselors will deliver a feasibility study that forecasts your risks and potential to obtain necessary coverage and capture savings through a Micro Captive Plan.

MICRO CAPTIVE INSURANCE COMPANY COVERAGE AND POLICIES
The insurance in a Micro Captive is customized coverage designed to expand, complement, and close gaps in existing insurance policies.

TAKE CONTROL AND INCREASE YOUR BOTTOM LINE WITH AN 831(b) MICRO CAPTIVE
Contact one of our risk advisors at: 411risk@CherryBekaertBenefits.com to learn more about the lower costs, broader coverage and greater control that can be yours with Micro Captive Insurance.

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Chernoff Diamond and their registered representatives are currently licensed to sell variable life and annuity products, as well as other securities products, in the states of California, Connecticut, Florida, Georgia, Maryland, Massachusetts, Missouri, New Jersey, New York, North Carolina, Pennsylvania, Virginia, Wyoming and Washington DC. Residents of other states should consult with a local registered representative for securities products.

Proper state registration is mandatory prior to conducting business in any state.